Budget Routine: How I’ve Paid Off Debt + Saved Money

Before I share my budgeting routine, I’ll admit that it’s only been in the last 7 years or so that I’ve felt confident with money.

At age 18, I signed up for my first credit card in my freshman year of college. I ended up carrying credit card debt for the next 15 years. I would get myself out of debt, only to pull out the credit card at some point and start the cycle over again.

Because I was always in debt, I believed that I was bad with money. I didn’t trust myself to spend within my means. Yet, I couldn’t get out of the cycle.

When I met my husband, he was about to pay off his student loans, and besides a mortgage and car payment, didn’t have any debt. I felt bad about the debt I was bringing into the relationship.

Since he was in a good place financially, and because he is a man (even though I didn’t realize it, I really believed men were better with managing their money than woman), I just assumed that he was great with money.

Once I left my job and became a stay-at-home mom, I struggled with feeling as if I had a say with where our money went. Even though my husband never once commented about how our money was spent, I wasn’t bringing home a paycheck so I figured he should be responsible for the money.

However, now that we were on one income, I had a deep interest in learning how to budget, pay off debt, and save money. I read books, listened to podcasts, and the two methods that really made sense to me were Dave Ramsey’s Baby Steps, and “Budget by Paycheck” from The Budget Mom.

I digested all the information and mentally figured out how it could work for our family. For months I sat on the knowledge I obtained. I was afraid to bring it up because of my stories around money and my worth as a stay-at-home mom. I wasn’t confident that I could really be in control of our finances and not screw it up. And since I viewed money as such a sensitive topic, I was really scared about making a mistake that would cost us lots of money.

Finally, I worked up the courage to share my ideas for paying down our debt and managing our money. My husband was open to the ideas, and was actually happy to let me take over managing our finances.

I think this was around 2019. That year, we paid off our credit card, my husbands truck, and worked on paying off my vehicle (we paid it off in 2020).

Since that time, we’ve stayed out of credit card debt, built a healthy savings account, and paid cash for major home projects and vacations.

I no longer believe I’m bad with money. I actually think the exact opposite now. I know I’m great with money and always have an intentional plan for every dollar.

That’s what I’m going to share with you today – the budgeting routine that will help you pay off debt and save money. No matter what your income is.

Disclaimer: I am NOT a financial expert, nor do I have any certifications or formal education in money management. Any information I provide is based on personal knowledge and general insights, and should not be considered professional financial advice. Always consult a certified financial advisor for specific financial guidance.

What is a Budgeting Routine?

To be aware of how your money is being spent, and intentional with how you’re spending it, you should be keeping a daily(ish) eye on your finances. That’s what I call a budgeting routine.

On a daily basis, I check our bank accounts, credit card account. We use a credit card for most purchases and pay it off on a weekly basis. We take advantage of the cash back options on these cards. We never carry a balance. I then take the cash back we receive and put it towards whatever monetary goal we are working towards.

While I’m checking the accounts, I write down all activity in my “Budget by Paycheck” workbook. You can find the planner here. This is my 4^th year using this planner and I credit it for helping us meet our money goals.

This daily budgeting routine takes about 5-10 minutes. I usually do it as part of my morning routine. It’s worth spending the time in order to make sure your hard-earned money is going where you want it to go.

The Budgeting Routine I’ve Used to Pay Off Debt + Save Money

Step #1 – Decide on your money goals.

You have to have a plan in place for what you will do with your money. For example, my money goals for 2025 are the following:

• Pay off my husband’s truck (the truck he bought after paying off his other truck).
• Start paying off our boat.
• Save for an Alaskan Cruise.

With these goals in place, I know where to put any extra money we have leftover after our budget is completed.

Even if it’s a few dollars, it goes towards goal #1. I truly believe no amount of money is too small. The last payment we made on my car was for five cents! Those five cents meant the world to me because I finally owned my car. I had never owned a car in my life!

I also want to point out that when I took over managing our money, I took the advice of Dave Ramsey and saved $1,000 in our savings as an emergency account. This was our absolute first goal. Once we met this goal, THEN we started paying off debt.

Step #2 – Make a list of all your bills and when they are due.

To make this easy, look at your bank statements and credit card bills to see when things are deducted or paid.

This is also a great time to evaluate if there’s any memberships you want to get rid of – and it doesn’t have to be permanent. We subscribe to YouTube TV during football season. We get rid of it after the Super Bowl. That saves us $600 a year!

Once you have this list together, you should have an idea of your monthly expenses.

Step #3 – Make a list of how much you spend on “life” stuff.

In order to not deprive yourself too much, think about how much you spend on a monthly basis on things like:

• Clothing
• Dining Out
• Entertainment
• Hobbies
• Kids Activities
• Pet Fund

While putting this list together, be realistic. You can always cut back in an area, but better to be honest with yourself as your putting your budget together.

Similar to dieting, if you deprive yourself for too long, you might end up “binging” on a spending spree. This is how I got myself into credit card debt in my 20’s.

If you give yourself some money to still enjoy life, then you’re more likely to stick to your budget.

Step #4 – Write down bills you pay on a quarterly, bi-annual, or annual basis.

These are bills that might sneak up on you and make it difficult to pay. Some examples are:

• Insurance payments (house, car)
• Taxes
• HOA Fee’s
• Water Bill
• Memberships you pay annually (Costco, Triple A, Streaming Services)

Then divide all these payments by 12 months. I’ll share this method in a minute, but this is how I save for these big bills.

Step #5 – Add up your monthly expenses.

Now that you have every single (expected) expense for the month, add up the numbers. The number you end up with is money that’s already accounted for every month.

If you have any money left over after your monthly expenses, that can go towards your first money goal – no matter the amount!

If you don’t have any leftover, then it’s a good time to evaluate ways to cut back on your expenses. Personally, switching grocery stores for shopping saved us almost $100 a week in groceries.

Keep in mind that this will not be forever! You’re making sacrifices now to get to where you want to be in the future.

Step #6 – Create your budget using the “Budget by Paycheck” Method created by The Budget Mom.

Once I had our monthly expenses figured out, I started following the “Budget By Paycheck”  (BBP) method.

Basically, every paycheck is designated toward certain bills that are due withing the timeframe of that paycheck (or before you get your next paycheck). Everything you have left after that goes toward your money goals.

When I started this process, my husband was paid weekly. This meant that I went through this process each week when he was paid.

Miko with theThe Budget Mom recommends that you use a calendar to record your monthly expenses and then write down when you’re paid. You then use the calendar to see what paycheck will cover what expense.

This method made it so easy to make sure every dollar was accounted for. It also meant that every week, I had an opportunity to put money towards one of our money goals.

Step #7 – Monitor your budget and your spending daily.  

I didn’t always have the BBP Planner, in the past, I used a notebook. I also downloaded free resources from The Budget Mom website.

Having a resource to actually write down and track our expenses and spending held me accountable to our budget.

I talked about my daily budgeting routine in the beginning of this post so I won’t go into detail here.

However, I will say that tracking and then celebrating all the little wins along the way has made this system sustainable and extremely effective.

Extra Tips to Help Stick to Your Budget

The Envelope System – Every month I withdraw a certain amount of cash. That cash is earmarked for a bunch of different expenses. Some of the cash goes toward savings for our annual and bi-annual bills. I also have envelopes for entertainment, dining, clothing, hobbies, kids activities, etc. I consider every envelope like a separate savings account. When it comes time to pay a bill, I deposit the cash in our checking account.

Visual Trackers – When I’m working on a savings goal, or paying off debt, I love to use visual trackers. It’s a great way to monitor your progress. I enjoy coloring in the tracker each time I work toward the goal.

Schedule Time Before You Get Paid to Budget – Set yourself up for success by putting as much of your budget in place as you can, before you get paid. It’s really easy to get your paycheck, and then spend it before you have a budget in place.

Add Up Monthly Expenses and Document in Spreadsheet – I created a Google Sheet to record our expenses monthly. Then at the end of the year, I can see how much we spent on things like dining out, vacation, clothing, etc. I will use this to help create our cash envelope budget for the following year.

Color Coding Expenses – It’s easiest to add up your expense categories at the end of the month if you give each category a color.

Use the Snowball Method – I learned this from Dave Ramsey. The snowball method is when you pay off your lowest (amount) debt first, then use the money from that debt to pay (on top of the minimum payment) for the next debt. Ultimately snowballing into paying off your debt.

Open Different Savings Accounts – Once we were in a good place financially, I opened a savings account for vacations. We also have one for gifts/holiday/donations.  I automatically deposit money into the gifts savings account on a weekly basis. This makes it easier when Christmas comes.

Keep a Cushion in Your Checking Account – If you’re able to, give yourself a cushion with each paycheck (even if $25), in case something out of the ordinary comes up. Now that we are in a better place financially, and I trust myself with money, I designate a certain amount of money each month for our cushion. It’s part of our budget.

Results of Using the Budget Routine

I’m so proud to say that since taking over our finances and managing my husband’s paychecks, and now mine, we’ve accomplished so many money goals.

Here’s just a few:

Use This Budgeting Routine to Meet Your Money Goals

I hope you’ve found some inspiration to create your budget and start working towards your money goals. It may seem like a lot of work, but you work hard for your money so it’s worth giving it the time.

To recap, here’s the steps to follow:

Step #1 – Decide on your money goals.

Step #2 – Make a list of all your bills and when they are due.

Step #3 – Make a list of how much you spend on “life” stuff.

Step #4 – Write down bills you pay on a quarterly, bi-annual, or annual basis.

Step #5 – Add up your monthly expenses.

Step #6 – Create your budget using the “Budget by Paycheck” method created by The Budget Mom.

Make sure to give yourself grace and understand that you won’t do it perfectly at first. But just keep trying and eventually you’ll reap the benefits of feeling confident with how your managing your money.

Before you leave, grab The “Type A” Moms Guide to Feel Organized + In Control of Your Time, for FREE.  You’ll find it here.